Britain will send experts to eurozone talks on new rules to save the single currency union after London rejected new EU measures on budget discipline, Poland said on Friday. "Over the last 24 hours we have learned that Great Britain will send experts to meetings on the new regulations," Poland's Foreign Minister Radoslaw Sikorski said on Friday as his country winds up its term as EU president at the end of this month.

Poland's Prime Minister Donald Tusk would be in contact on Friday with British Prime Minister David Cameron, Sikorski said. "We know that Britain has announced its participation in an experts' group which is to prepare the text of the new measures, so I think Britain's position is less determined than London tabloids would have us believe," Sikorski said on Friday. On Wednesday, Cameron brushed aside calls to negotiate a new EU treaty.

The British prime minister said he "made no apologies" for vetoing a new treaty at a eurozone crisis summit last week, a move which led to the other 26 European Union nations agreeing to draw up, without Britain, a pact to boost integration and save the euro. Cameron's comments came a day after European Commission Chief Jose Manuel Barroso said that Britain's demands for its financial services industry to be exempted from EU regulation threatened to break up the EU's 27-member single market.

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Forces face a new enemy

The Chief of the Defence Staff, General Sir David Richards, was doing no more than stating Government policy this week when he said that the single biggest strategic risk facing the country today is economic rather than military. “No country can defend itself if bankrupt,” he said in his annual review of defence policy at the Royal United Services Institute. Britain is still one of only three significant NATO members, out of 28, who spend 2 per cent of their GDP on defence. Nevertheless, the country is facing volatile times in austere circumstances. We need to think strategically, he maintained, and reform the Armed Forces even while they are extensively stretched. It’s a challenge akin to rebuilding the ship while still at sea. To those who lament recent defence cuts as somehow lacking in strategy, the Government’s answer is therefore simple. Britain’s grand strategy – as immediate and overwhelming as anything in 1940 – is to maintain the country’s triple-A credit rating in the international markets. Without that, no credible defence strategy would be affordable.

As the country’s top military officer, Sir David is duty-bound to set out the Government’s grand strategic case in this way. But he also has to deal with the consequences of it. He has to speak military logic to the politicians, and political logic to the military. He does not interpret his role, and nor should he, as the champion of the military in a public battle with Downing Street for resources. Grandstanding against the Government is not his job, and certainly not Sir David’s style. But what he said was also the tip of a nasty iceberg that he and others can see drifting ever closer to the ship of state. The tip of the iceberg, it has to be said, is not all bad. Britain remains a significant military player; the fourth largest military spender, behind the US, China and Japan, and ahead of France and Russia. If the first division of real military power only includes the United States, Britain stands in the top half of the second division that presently consists of Russia, China, France and India. And though Britain and France will drift towards the foot of that division over the coming decade, they will not be quickly relegated from it, if only because there is such a yawning gap to the third division below.

None the less, Sir David also knows that to stay in the game at all, military forces have to be credible and able to be used in different situations at short notice. Forces that look impressive on paper, or forces that take years to mobilise, are no use to Britain in the 21st century, and no one would bet on a period of idleness for the military in the near future. So in the present climate, military chiefs have got to balance the risks of their trade in a different way. Last year’s defence review took 7.5 per cent out of the defence budget and committed the MoD to eliminating its famous “black hole” of unfunded future commitments that was, in reality, about £27 billion net. This summer, the Government put 0.4 per cent back into the defence budget as a whole to guarantee forward equipment programmes, but now the autumn statement extends existing defence cuts from 2015 out to 2017 and it would be foolish to rule out even further tightening before we get to 2017. For Sir David, the new balance of risks is relatively clear. Britain aims to keep as many military capabilities as possible intact and “rebalanced” by 2020. By that time we plan to have a smaller Army of only 82,000, but a bigger, usable Reserve; a small force of new US jets to serve with the Eurofighter Typhoon; an effective strike aircraft carrier; refurbished nuclear forces; next generation electronic assets – the new battle winners – and a reformed MoD to manage it all.

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Jobless data soars

Britain's jobless total has hit a new 17-year peak and youth unemployment a record high, data showed Wednesday, dashing government hopes that private companies would offset public sector job losses. The number of unemployed climbed by 128,000 in the three months to October to reach 2.64 million, the Office of National Statistics (ONS) said in a statement. That was the highest total since 1994. The grim data also revealed youth unemployment, or the number of 16-24 year-olds without a job increased 54,000 to 1.03 million in the same period -- which was the highest level since comparable records began in 1992. The overall jobless rate held at a 15-year high of 8.3 percent in the three months to October, compared with the three months to September.

"Any increase in unemployment is bad news and a tragedy for those involved," Prime Minister David Cameron admitted in his weekly question-and-answer session in parliament on Wednesday. "That is why we will do everything we can to help people back in to work," he said, stressing the government's plans to try and create new jobs and work placements for the young. However, Ed Miliband, leader of the opposition Labour party, accused Cameron's government of "betraying a whole generation of young people" with its policies. But Cameron insisted that boosting the private sector was the only way to tackle unemployment -- and argued that whichever party was in power would cut public spending. "The absolute key to all this is getting our economy moving," the premier said.

"We need private sector jobs. It is this government that has got interest rates down. "That is why we have the prospects of growth -- whereas his plans are for more spending, more borrowing, and more debt, more of the mess that we started with." Cameron's Conservative-Liberal Democrat coalition hoped the private sector would create enough jobs to offset heavy losses in the public sector but the economy has been hit hard by the debt crisis in key trading partner the eurozone. He said private sector had created 581,000 jobs since the coalition came to power in May 2010, while 336,000 posts had been shed in the public sector.

Economists said that the dire data has sparked questions about the coalition's ongoing austerity drive, which is aimed at slashing a huge public deficit. "Worries about real income and employment prospects -- exacerbated by austerity measures and unpredictable spill-overs from eurozone sovereign debt crises -- mean that UK consumers will be hunkering down for a difficult winter," said Daniel Solomon at the Centre for Economics and Business Research.